South Africa: Media Statement - Tourism Committee Calls On the Department to Assist the South African Tourism to Improve Its Performance

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The Portfolio Committee on Tourism today received a briefing from the South African Tourism (SAT) on its 2020/21 annual report as part of its Budgetary Review and Recommendation Report (BRRR) process.

The Chairperson of the committee, Ms Tandi Mahambehlala, said the report of the Auditor-General of South Africa (AGSA) on SAT is not looking good as the entity received a qualified audit with material findings. She called on the Department of Tourism to assist the entity to improve its performance.

The AGSA found fruitless, irregular and wasteful expenditure of R20 million. Ms Mahambehlala said the entity did not comply with the Public Finance Management Act (PFMA); it had poor internal controls; it did not implement the Audit Action Plan; and did not conduct adequate reviews on the annual performance plan.

The AGSA found that there were payments that were made to 58 beneficiaries who are employed by the municipalities; municipal entities, government departments and entities; 17 beneficiaries who were deceased; 26 duplicate payments; 273 beneficiaries who received the South African Social Security Agency (Sassa) grant; 100 beneficiaries who received the tourism relief fund; 1172 beneficiaries with invalid Identity Documents (IDs) or no ID numbers, and 641 beneficiaries who received Unemployment Insurance Fund (UIF) payments.

The Minister of Tourism, Ms Lindiwe Sisulu, informed the committee that she is aware about the AGSA findings and the general corrupt relationship between the former Chief Executive Officer and Tourism Marketing South Africa. She made an undertaking that she will meet with SAT Board and AGSA and will revert to the committee regarding consequence management or recovery of the lost money.

The interim Chairperson of the Board, Ms Mojanku Gumbi, informed the committee that this is the first time in 17 years that SAT has received a qualified audit opinion. She explained that SAT collaborates with the Tourism Business Council of South Africa (TBCSA) which supports activities of SAT and that TBCSA follows its own supply chain management processes.

Ms Gumbi further informed the committee that the former CEO had resigned before the investigation could be finalised and that the Board had picked up that payments had been made via the Collaborative Fund instead of the levies.

Regarding the issue of the 2019/2020 capital funding of the Expanded Public Works Programme, the Director-General of the Department of Tourism, Mr Victor Tharage, informed the committee that an investigation was done on the payments made from 2005 to 2014 and that its outcome has been reported to the law enforcement agencies and has been shared with the State Attorney.

The committee also noted that the financial performance of SAT did not correlate with the actual performance of its programmes. SAT had set 28 targets for the 2020/21 financial year, but of those targets the entity was able to achieve only 23. The committee expressed a concern over the entity's overspending by 29 percent.

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